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Post by dankbuys on Oct 10, 2015 17:43:33 GMT
Who /futures/ here?
Futures are never discussed on /biz/ cause threads get hijacked and most people can't into futures anyway
Wondering if anyone trades futures here? My goal for the "market speculation" board is to create a collection of trading/investing resources that aren't easily found in online, I might try to get a pit noise plugin for futures
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Post by rephrain on Oct 10, 2015 21:12:03 GMT
I know the basics. Looking forward to discuss trading ideas and bring in the alpha.
This section needs a fixin' though.
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Post by dankbuys on Oct 10, 2015 22:06:21 GMT
Yeah I know, hopefully someone in CS can clean it up by monday
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Post by angusburger on Oct 11, 2015 5:23:33 GMT
Who /futures/ here? Futures are never discussed on /biz/ cause threads get hijacked and most people can't into futures anyway Wondering if anyone trades futures here? My goal for the "market speculation" board is to create a collection of trading/investing resources that aren't easily found in online, I might try to get a pit noise plugin for futures Feel free to drop some knowledge, educate us so we can hunt for futures!
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Post by dankbuys on Oct 11, 2015 22:56:46 GMT
Natural gas has some decent action right now if anyone is online
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Post by rephrain on Oct 12, 2015 0:10:54 GMT
Oh, I don't know about trading commodity's but I'm pretty well versed in option trading.
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Post by dankbuys on Oct 12, 2015 0:53:15 GMT
Futures are an agreement to buy or sell a commodity, currency, stock, whatever at a future point in time. If you think it's going up you buy a contract vice versa. Contract sizes are usually 100 or 1000 units of the asset and are bought with massive leverage. (which is what makes it fun to trade amirite)
You need a minimum of $2000 to open a margin account (federal law), and then you need to apply for futures trading IMPORTANT NOTE: Lie your ass off when you first open the account, and again when you apply for futures. Say you want a lot of risk and you have a lot of experience/capital. The process is to protect them from lawsuits if you lose all your money, they'll approve anyone if you lie (they can't check anyway).
Now that you actually have the account, to figure what contracts you can trade you want to look for the "margin requirement" and "tick" size" Margin req. is the minimum amount you need to put down to buy 1 contract (the broker loans you the rest and buy the contract for you) Tick size is the change in value for the entire contract when the underlying moves 1 tick (the minimum price movement)
Added note: Shorting futures doesn't work like stocks because you can write a sell contract out of thin air, so price can be more volatile
Also futures are used by physical commodity supplier and buyers to protect themselves from price movements, so contracts have expiration dates
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Post by rephrain on Oct 12, 2015 0:58:21 GMT
So it's basically a call or put option on commodity price?
I'm guessing you day trade these futures?
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Post by dankbuys on Oct 12, 2015 1:11:51 GMT
So it's basically a call or put option on commodity price? I'm guessing you day trade these futures? Kind of, there's no exercise option. You either have to sell the contract or execute it when it expires They trade like stocks functionally, just with massive leverage and less volume/automation so you can actually have a decent edge trading And cheaper commissions too, as low as a few cents per contract Oh and not just commodities, indices like the Dow, S&P, VIX, Nikkei, and treasuries it's pretty the best way to trade
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Post by rephrain on Oct 12, 2015 1:19:36 GMT
So how do you go about a trade? Do you need macro-economic knowledge? Or do you just watch early day futures trading, decide if you're going long or short, then purchase the contracts?
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Post by dankbuys on Oct 12, 2015 1:27:03 GMT
So how do you go about a trade? Do you need macro-economic knowledge? Or do you just watch early day futures trading, decide if you're going long or short, then purchase the contracts? Any stock trading strategy would still apply to futures, A lot of people literally just look at the orders and the sales that are coming in and try to see what the supply and demand is Futures are more transparent than stocks so you can pretty much see all the open orders
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Post by rephrain on Oct 12, 2015 1:34:08 GMT
Alright makes sense, thanks for answering my newbie questions by the way. Very dank of you.
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Post by uplade3 on Oct 12, 2015 2:35:53 GMT
So how do you go about a trade? Do you need macro-economic knowledge? Or do you just watch early day futures trading, decide if you're going long or short, then purchase the contracts? Any stock trading strategy would still apply to futures, A lot of people literally just look at the orders and the sales that are coming in and try to see what the supply and demand is Futures are more transparent than stocks so you can pretty much see all the open orders I tend to check news and 10ks for stocks, could the same apply for futures? Will you give an example from start to finish? I can Google but if someone like minded explains it, its easier
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Post by dankbuys on Oct 12, 2015 4:44:28 GMT
Yeah futures move exactly the same as stocks would, like I said it's practically the exact same. Trading UWTI/DWTI is the same as trading oil futures (the ETN's are based on the futures anyway) And trading SPY or VOO is the same as trading S&P futures (just be careful holding for too long) The futures match their underlying assets
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